Monday 26 Sep 2022 | 20:53 | SYDNEY
Monday 26 Sep 2022 | 20:53 | SYDNEY

Reader riposte: Corruption in China

12 December 2012 09:11

James Shelton, a former intelligence analyst and economic adviser, writes in response to an item in yesterday's Linkage:

The assertion that corruption in China is 'pretty normal for a country at its stage of development, and likely to decline as China grows' is a charitable statement indeed. The linked article asserts that 'the life-cycle theory of corruption — rising at the early stages of development, and declining after modernization has taken place. Hence, as China continues its development process, corruption will likely decline.'

The idea that corruption will decrease as GDP per capita increases doesn't pass the simplest fact check. To illustrate my point, the sample below shows that both China and Botswana's GDP per capita positions are inverted when compared to Greece and Russia when it comes to corruption. A more simple comparison is Greece-China. With a GDP per capita of nearly 5 times that of China, Greece is ranked 14 countries below (perceived to be more corrupt) China on the corruption perception index.

IMF GDP Per Capita 2010-2011 ranking

30th: Greece ($26,735)
53rd: Russia ($12,993)
66th: Botswana ($9,537)
90th: China ($5,417)

Transparency International Corruption Perceptions Index 2012 ranking (higher score = less corrupt)

30th: Botswana (score: 65)
80th: China (score: 39)
94th: Greece (score: 36)
133rd: Russia (score: 28)

The issue of corruption is a more complex beast. More likely a mixture of culture, rule of law and public policy than simple life-cycle economics.